UK government gives stronger indication on cutting student visas

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by Danny Harrington, Founder & Director, ITS Education Asia


As we reported back in October, the UK government is looking at making cuts to the number of student visas granted for university study as a means to make inroads to the total immigration figures. To recap, immigration has become a political “issue” over the past couple of years – the UK has a net immigration of some 300,000 people per year – and it was likely to have been one of the key ideas that led to so many people voting to leave the European Union.

Public opinion has the idea that growing the population by 300,000 migrants per year is somehow bad for the country. The same old tropes about “stealing” jobs and putting a “burden on resources” are wheeled out and seem to get the most attention in the media thus reinforcing them. Very little time is given to the productivity increases, the economic growth, the spending rather than saving of money, the enrichment of education, culture and the arts, the long-term network of economic and cultural links that are produced. The list goes on.

The lack of common sense being applied here just goes to show how politicised the debate has become. The government clearly feels it needs to “do something” to get public opinion on its side. It probably feels it is in a weak position right now and has one eye on up coming by-elections and the next general election which will all continue to be fought over Brexit – its key elements and its fallout. And as with so much these days, the whole thing is reduced to numbers, principally with a currency sign at the front.

So the Home Office has now made it clear it is looking at slashing 170,000 student visas per year from UK universities. That’s over half the current number. If you want to do economics, that’s 50% less money coming into the UK’s hard pressed higher education institutions from international students who pay much more for their courses as well. That’s 170,000 students who will go elsewhere to study and take not only their tuition fees to other countries but all the money they spend on rent, food, books, entertainment and so on. That’s a huge chunk of young, vibrant, clever, motivated people who will go on to jobs in other companies in other countries and stimulate their economies instead of the UK. That’s 50% fewer students to build economic, cultural and academic links between the UK and other countries in the future. And that’s 50% less of everything, 170,000 fewer people doing all these things every single year from now on.

The government has also confirmed its tier system of institution licences to recruit from overseas. Under this policy, institutions which have greater than a 10% visa refusal rate on the students it admits [some say it may be as low as 7%] will have their licence to give places to overseas students revoked. Given the government holds absolute discretionary powers over the award of visas, this means that by extension they now have de facto control of academia through the ability to cut off what is often a crucial funding lifeline for many institutions. This is a shockingly bad step. In a modern democracy, government simply cannot hold such a threat over education

It seems the politicians never learn. The UK refused Hong Kongers full passports in the years leading up to the handover back to China and so the the wealthiest and brightest went to Canada which welcomed them and modern Vancouver was created [simplifies I know, but that’s the gist]. If these plans are implemented, the same mistake will be the UK’s loss and somewhere else’s gain at a much larger scale. It is incredibly sad, especially when UK qualifications remain so well respected and desired all over the world.

Have you had visa problems for university study in the UK? ITS Education Asia can help. Our online BTEC provides years 1 & 2 of a UK degree and leads on to a final 3rd year for a full bachelors. All at a fraction of the price. Classes are live with expert lecturers and the BTEC has the advantage of being course assessed instead of exams. See here for details.

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ESF Subvention Update

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The Loss of the ESF Subvention

Anne Murphy
Director, ITS Educational Services Ltd

The discussions and negotiations have finally come to an end between the ESF Board and the Government. The decision is not a favorable one for ESF. The Government has not agreed to the long term retention of the subvention.
So, how will the loss of the subvention affect all existing and future ESF students? The recurrent subvention, frozen at the current level, will remain in place for three school years from 2013-2016. The subvention will be phased out year by year, over 13 years, so the last year group to qualify will be students who graduate in 2028-29. As a result, there is an expectation that annual tuition fees will rise by 23% in 2016.

To maintain the maintenance of the schools and facilities, further funding will have to be found from somewhere when the subvention completely ceases. So, as well as increasing tuition fees what else is expected. The ESF Board may even introduce a Corporate Nomination Right similar to that of Discovery College but at a much higher cost of HK$5,000,000 which will depreciate over 20 years.
The ESF Board did manage to secure the continuation of Government funding for ESF’s special needs provision and the re-building of Island School. Government subvention for Jockey Club Sarah Roe School (JCSRS) and for the Learning Support Centres (LSCs) (a total of HK$28.3 million per year) will be maintained at the existing level, pending a wider Government review of support for students with special educational needs.

Also, subject to approval by the Finance Committee of LegCo, a capital grant will be made available to assist in funding the re-building of Island School. The capital grant will be equal to 100% of the cost of constructing a standard design public sector school educating the same number of students. At today’s prices this would be HK$270 million. After the re-development of Island School, ESF, like all international schools in Hong Kong, will not be entitled to any financial support except for an interest-free loan for construction of a school on an allocated green-field site. ESF will fund the balance of the costs of re-building Island School estimated at HK$1.3 billion. The school will be re-built on its current site and the Education Bureau has agreed to search for sites to which students can be temporarily transferred during construction.

Further to the news about the subvention, ESF recently declared changes to their admission policies. Priority for an admissions interview/assessment will be based on the following ranked criteria; students who are able to benefit from an English medium education and who (in order);
1.Are the children of full-time staff at ESF or ESF Educational Services Ltd
2.Are siblings of students already attending an ESF primary or secondary school or Jockey Club Sarah Roe School
3.Are Nomination Rights holders
4.Are the children of former students who have attended an ESF school for minimum of 3 years or are former ESF students returning from a period overseas
5.Are other applicants who can benefit from an English –medium education.

Also, apart from interviewing prospective students, parents will also be interviewed and will be expected to write a statement to declare why ESF education is their preferred choice for their child. Isn’t it all just getting too much? If you need to know more about the new admissions procedures, or how the loss of the subvention will affect you, drop us an email at [email protected] to schedule a consultation.

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New school doors open in Sai Kung 2013

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Hong Kong Academy is moving to a purpose-built campus in Sai Kung in 2013, designed to maximise experiential learning, community engagement, and environmental sustainability.

The new building will sit at the junction of Wai Man Road and Mei Yuen Street, near the car park for the Kai Sau Chai golf course.

Founded in 2000, Hong Kong Academy is an independent, non-profit international school for pre-kindergarten through secondary, which follows the IB curriculum. The school supports the child’s individual learning style and natural strengths, providing a well-rounded, student-centered program with a teacher-student ratio of 1:6, a maximum class size of 18 and just two classes in each year group. It offers a differentiated educational program to meet the needs of accelerated learners as well as special-needs students who can participate and contribute to a mainstream classroom setting.

Currently housed at 12 Kai Wai Man Road in Kennedy Town. HKA has grown by more than 20 per cent a year. It has more than 400 students representing more than 38 countries. Classes are limited to two sections per grade and are kept intentionally small. The school has a committed and involved parent community.

The entire Hong Kong Academy community is very enthusiastic about the move to Sai Kung. Its permanent home will be a model for green building and education, using environmentally sound building materials, conserving energy, water and other resources and promoting a healthy learning environment for children. It also offers HKA the opportunity to develop an extensive outdoor education programme as well as space to construct separate primary and middle/high school buildings with shared facilities. Scholarships are available for several selected students in each year from grade 3.

If you want to know about HK Academy, go along to an Open House at their current location in Kennedy Town. The session consists of a talk from their Directory, Primary School Principal and Admissions Coordinator followed by a tour of the school facilities. Every session starts at 9:00am and lasts for approximately one hour and half.

Parents need to register with the school for a session by calling or emailing the school. The following are the Open House sessions for 2011.

April: 14th

May: 12, 26th

June: 9th

Tel: 2575 8282.


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How to help your child move schools during the world-wide financial crisis.

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Recently, a lot of families have had to move their child/children out of Private and International schools in Hong Kong mainly because of the economic circumstances that exist everywhere.

Moving schools to Hong Kong

 For parents, this is a very worrying factor, parents worry about finding another suitable school for their child with lower fees with the same academic success in either the country they dwell in or a new country. And of course, another worrying factor is the assurance of a child’s happiness and stability.  A lot of worries come with moving a child from one school to another and for many families in Asia and other parts of the world; this is an imminent or existing issue.

 The anticipation of change and the early stages in a new school are challenging for everyone. In most circumstances, the children who find change most difficult are those whose parents do. It is vitally important that parents make every attempt to recognise and convey the opportunities inherent in change and to address any problems as a family before moving or deciding on a new school.

 For what ever reason exists that may cause a change in a child’s school life, parents hold the answers to their questions and should therefore share as much about the circumstances as children want to know and are able to absorb, using their questions as a guide.  It is essential that they are told that neither they nor their parents have done wrong, and that the current economic circumstances are something that the world is experiencing together and that many children around the world are sharing the same change. It might be a case that some of their friends at their school are going through the same, if so; they have one another to share their feelings with.  Parents should be available to speak with their children and to answer all their questions.

 The key to a successful transition for both child and family is one of ‘Communication’.  Without ‘Communication’ the bond is lost and children experience the pain and stress of the transition on their own. Parents need to ensure that a relaxed, calm family life exists at home and that children are not involved in arguments between parents. The less change to their home life the better and the more you reassure them that their lives will not change too much the easier it will be for everyone to move on.  

 Allow your child to become involved in the school search and help arrange appointments for schools visits.  Engage your child in the choices available and the pros and cons of each school.  Above all, understand your child’s needs and before a decision is made evaluate what is the best moving forward for your child.  

Author, Anne Murphy

Relocating to Hong Kong

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Raising funds for a new business – The alternatives

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The following is the text of a recent talk I gave in Hong Kong for the Women Business Owners Club on raising funds and starting a business in Hong Kong.  It should be help to any person thinking of starting a new business.                                    



The art of starting and running your own business 

 When anyone talks to me about a business idea I always start by asking them 3 questions. 

 1)     What is your growth strategy?

 2)     What is your exit strategy?

 3)     What is your critical risk? 

If people cannot answer these three questions then I am not very interested in talking about their business idea anymore as they have not thought it through themselves.   So I will start by asking you to think about these questions.  If you do not have answers then my advice is that you reconsider your plans…… 

Raising money for a business venture in Hong Kong

Questions one and two – 1. Why?  2. How much? 

From both my own personal experience, and working as a consultant for small business for many years these two questions are the most important start and end points of the search for funds. It is not enough to have the concept or idea.  You must have a clear plan.  People cannot help you achieve your goals if they are vague and lack detail.  Do Not even bother starting to try to raise funds until you have clearly thought out and answered these questions.  The importance of a good business plan cannot be emphasised enough as a starting point in raising funds.  Its role is not just to convince others to lend or invest money in your venture.  It is much more important than that. What a good business plan does for you: 



  • Gives a clear idea of a business’s direction and operation
  • Brings clarity and detail to your ideas
  • Gives the idea depth
  • Helps focus all involved in exactly what the goals are
  • Reduces potential for future conflict
  • Gives a much more realistic base to the level of finance that is needed
  • Is a marketing point for potential lenders and investors as it shows the business’s likely financial position and its ability to pay back a loan or pay dividends
  • Helps reduce stress and uncertainty
  • Identifies problems before they occur and allows a business to deal with them before they become a problem
  • Highlights a business’s strengths and weaknesses
  • Gives comfort and reassurance to family

A good business plan is the single biggest challenge in raising funds.  If you cannot produce this yourself then consider paying someone to help you.   Producing a business plan is not really that difficult.  If you start with a pro-forma and basically fill in the blanks you will come up with something pretty reasonable.  The next step is to show people whose opinions you respect and incorporate constructive criticism.  A respected mentor of mine once told me  “The only person you do not want to be in business with is someone who knows everything”. The financial plan is extremely important and if your knowledge of accounting is limited this may be an area that you should seek help on. Remember you must be able to justify and support any and every aspect of your plan. 

Also remember to THINK BIG – no one is interested in small. An outline of a business plan is included at the end of these notes.  

Once the plan is completed. Once you have a plan and know exactly what you want the next steps are quite easy and straightforward. Sources of funds: Before I speak about these I have a couple of warnings. I am sure you have all heard the story of Goldilocks and the three bears. The theme of this children’s story is about seeking what is just right, not too big, not too small.  If you try to start your venture with the bare minimum of funds you are setting yourself up for stress and failure.  Things will go wrong. If you raise more funds than you need you are likely to overspend and therefore waste money.  You may have to give up too much of future earnings or the business to get funds that just sit in a bank account.  Wasted money can be hard to recover.  Also staff, if they see things done in a wasteful and glamorous style, are likely to be much more demanding. Only raise what you need.  But be realistic about this and make sure you have enough for contingencies. Borrowing money or finding investors for a businessWhen considering how you should raise the necessary money for your business it is extremely important to start with a plan. Many new businesses fail because they are under-capitalised. It is easier to raise / borrow money at the start of your new business venture than when things begin to go wrong.Your options for funds are

  1. Put your own savings into the business
  2. Borrow funds
  3. Find investors for your business


  • Put your own savings into the business

The two sources of own funds are really savings or selling of unused or under used assets.  I think it is very important to contribute some of your own funds as it helps to convince lenders/investors that you believe in the project.  It also tends to make a project less risky if the portion of borrowed or outside funds is less.

  • Borrow funds

This in my opinion is the most difficult way to raise any significant level of money.There are some easy options here.  Personal loan – In Hong Kong even if you have a reasonably low level of income a personal loan of up to $200,000 is fairly easy to obtain from the bank.  Just do not mention you want to borrow it for a business venture.  It is on the other hand quite easy to get a loan to; renovate you apartment or go on a holiday etc. Credit cards – Not, in my opinion, the best way to raise funds as the interest rates are very high.  But a very easy source of loan capital.  Youtube was largely financed by the guys that set it up on credit cards.  Family – Here you do not have the trust issue.  But there are a range of other possible complications.  Very good if it an option but I would recommend considering selling them part of the business venture rather than borrowing money from them  SME Loan guarantee scheme – Excellent.  The Hong Kong Government rocks in operating a business here. 

These loans are largely available to cover the cost of fixed assets.   The Government Website:

 Business loan from bank/financial institution – On the whole Forget it.  (Unless you are a large well established business or are willing to put up personal collateral).  In my experience banks do not lend money to small business startups.  Banks do not lend money for new ventures.  If you want a loan from a bank do not even mention business start up or new venture.Leasing – Consider what equipmet/machinery you may be able to lease.  This can keep your initial cash requirements down. Factoring – When you sell goods on credit the invoice provides evidence of the sale and the money owed to the company.  Debt factoring is when a financial institution provides finance against the unpaid invoices.  This can be very useful for a trading company. 

  • Find investors for your business

In my opinion this is a much better option than borrowing.  Many people want the opportunity to get in on the ground floor of something new. With a good plan and a good vision it is quite easy to find investors.

 Talk about your plan and vision to everyone and let it be known you are looking for potential investors.  You will be amazed at how many people will want to talk to you about the possibility.  My advice – ask family first.  Two main reasons – One: they may be upset if you do not give them the opportunity & Two: It makes drawing up shareholder agreements etc so much easier. Business Angels/Venture Capitalists  A Business Angel is an affluent individual who provides capital for a business start-up.  Angels typically invest their own funds, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund.Both of these are possible sources of finance for a business start up.  For most SMEs an Angel is probably more appropriate as Venture Capital firms are more into larger amounts of money (ie US $ millions).  You may have a wealthy friend/aquantaince who can be convinced about the potential of your business.  This is the benefit of talking about your business idea to everyone and asking for advice/suggestions.  Someone will know someone….   But consider carefully if you want this source of finance.  Normally these people will want substantial ownership and input in the business to protect their investment.  VC do not invest in a business for a 10% return they typically will only invest if they believe they can make 100%, 200% return plus.  If then they are willing to invest in your business, ask yourself if you really need their money.  It can end up being a very expensive way to finance a business.  You can also end up seeing control of a business being taken out of your hands.THE HARDEST PART – By far the most difficult part about an investor is exactly what they will get and the level of say they will have in your business.  A detailed and comprehensive shareholder agreement MUST be written up.  

I have included a basic outline and format with suggestions about how to go about approaching lenders or investors and a basic outline of what should be included in a Business Plan. Planning your case 

  • Your success will largely depend on a well thought out business plan and on your reputation.
  • The more comprehensive your plan the better your chances of getting an investor or loan for your business.
  • Prepare a background statement about your business, setting out objectives, ownership, assets, staffing, location, markets and services.
  • Persuade lenders/investors that their money will be safe. Show that it will be used to earn a good profit and you will be able to repay capital and interest or dividends on time.
  • Budget for contingencies.  Produce evidence of the demand for your products and services. Market survey figures will help your case.  (IF the plan is for expansion – Include copies of your accounts for the last three years if available.
  • For new ventures prepare a feasibility study giving a cash flow analysis showing your predicted income and profit and loss figures.
  • Get reports to support your case from your accountant and other appropriate professionals.

Lenders or investors will look for: 1. Your assets so they can get their money back if things go wrong2. A commitment from you3. A realistic budget allowing for all possible contingencies4. Your ability to pay dividends or repay loans. 

Information you should give the lender or investor: 1. The reasons for borrowing/raising the money2. The amount you need3. Your marketing plans4. Your pricing formula5. Your starting budget6. Your cash flow forecast for the next three years 7. Your audited profit and loss and balance sheets for the last three years. Preparing your business plan A plan is absolutely essential.  Not only will it help you raise the money you need but it will help you to clarify your ideas and assess the project more objectively. Once you have your ideas on paper it will help you to raise money and permit you to monitor the project once you start. 

  • If you are using your plan to raise money the document should be crisp, neat and free from errors, with an attractive cover.
  • It should contain all relevant names and addresses including those of your accountant, solicitor and bank.
  • It should be well set out, easy to read and written in the third person.
  • Make a clear statement outlining the project and its objectives.
  • Include the reasons for wishing to raise / borrow the money.
  • Give the business history of the firm and the management. Include the date of incorporation (if a limited company) and the qualifications and experience of management and staff.
  • Give the budgeted plans for the next three years (If the plan is for expansion the company’s financial position with audited figures for the last three years).
  • Describe the product or services your business will be offering. Include photos if appropriate.
  • Summarise your market research. Give the size of the market. What competition is there? What advantages do you have over your competitors? The more accurate the figures the better.
  • How do you intend to advertise, promote and sell your product and services?
  • Name your distributors, suppliers and subcontractors.
  • State the type of premises you have or require, with geogra­phical location.
  • List the equipment you have or need, and the age of your machinery.
  • Describe the vehicles you have or need for transport.
  • Do you need planning permission or a license to get started?

A Basic pro forma of a business plan should include the following: 


What to include
The Business
  • Name and address of the business
  • What the business aims to achieve
  • The type of organization the business will be
The Product or Service
  • What is being produced
  • What quantities will be produced
  • The proposed price/pricing strategy
The Market
  • The results of your research or testing
  • The size of the market
  • Whether the market is growing or not
  • Who will buy the product
  • What is the business’s unique selling point
  • Competition and their strengths and weaknesses
  • Methods of promotion and advertising
The Personnel
  • Who will be involved in the business
  • What experience and skills people have
Buying and Production
  • Likely costs of production
  • Who the main suppliers will be
  • What benefits these suppliers have
Premises and Equipment
  • The type of premises
  • Location of premises and cost
  • Age, style and value of machinery/equipment
  • Replacement cost of machinery/equipment
  • How you will cope with expansion
  • Likely profit based on turnover (sales x price)
  • Costs
  • Break even point
  • Budgeted profit and loss statement
Cash Flow
  • When cash will come in
  • When cash will go out
  • If payments will be cash or credit
  • Difference between cash in and cash out each month
  • How much cash owners will put in
  • How much will have to be borrowed
  • What the money is needed for
  • How much borrowing will cost
  • What assets can be used as security
  • How long the borrowing will be for and when will it be paid back

 Financial Plan: OutlineThe following is a basic outline of the main financial reports that should be included in a business plan. There are three types of financial statements essential in business.  1. Profit and loss accounts2. Cash flow forecasts3. Balance sheets. You should seek advice from an accountant to help and advise you during their preparation. 
1. Profit and loss account This summarises your income and expenses over a set time and should include the following items:·         Income from sales or services·         Cost of goods or services sold (include the stock you had at the start less the stock at the end).·         Gross profit or gross margin. (This is the difference between your sale profits and the cost of the goods or services.)·         Operating expenses (include all your costs).·         Profit before income taxes·         Income taxes·         Net profit (your actual profit or loss after paying tax).
2. Cash flow forecast This is a summary of the money you expect to receive and pay out during a set time. Here is an example:     

cash flow forecast

 3. Balance sheet This is a summary of assets, liabilities and your equity in the business at a specific date. It shows what the business is worth. You can have a great plan and work very hard but if you can’t get backing, if you can’t get money when you need it, you can’t get anywhere.  Good Luck 

Prepared by Gary Hadler, B.Ec, Dip.Ed, MBA.

Principal: ITS Tutorial School. Director: International Tuition Services Ltd 



©This material is copyrighted and cannot be reproduced or published in any form without the express written permission of the author 

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